The
Management Department & The Research Center
-
MOS WORKSHOP -
Srividya Jandhyala and Himanshu Bhatt
will present their paper
Tuesday, March 12th 2019
Room N517
– 9:15 a.m in
Cergy
4:15 p.m in
Singapore
Theme:
“Political Risk Reversal: Hold-up
of governments by firms in
infrastructure projects ”
Abstract: A central idea in the literature on
political risk is that governments opportunistically appropriate returns from
firms’ investments. In contrast, we argue that firms are also opportunistic in
their interactions with the State. Firms take initially disadvantageous
position (vis-à-vis the host government), with the expectation that they can
influence government actions ex-post to obtain more favorable investment terms.
We illustrate this using the case of aggressive bidding in infrastructure
projects and develop a detailed case study of an airport project in India. We
extend the analysis to identify institutional characteristics that moderate the
effectiveness of aggressive bidding in generating ex-post gains for the firm.
